Confirming reports passed on by commenters at the Isaac Brock Society, DiploPundit points to a State Department interim rule just placed on public inspection for printing in tomorrow’s Federal Register, which raises the fee for renunciation of U.S. citizenship (but apparently not relinquishment) to US$2,350, more than twenty times the average level in other high-income countries. As they state:
[D]emand for the service has increased dramatically, consuming far more consular officer time and resources, as reflected in the 2012 Overseas Time Survey and increased workload data. Because the Department believes there is no public benefit or other reason for setting this fee below cost, the Department is increasing this fee to reflect the full cost of providing the service. Therefore the increased fee reflects both the increased cost of the provision of service as well as the determination to now charge the full cost.
The Universal Declaration of Human Rights states that “No one shall be arbitrarily deprived of his nationality nor denied the right to change his nationality”, while the Expatriation Act of 1868 says that renunciation of citizenship is “a natural and inherent right of all people” and that “any declaration, instruction, opinion, order, or decision of any officers of this government which restricts, impairs, or questions the right of expatriation, is hereby declared inconsistent with the fundamental principles of this government”.
As of press time, the State Department has not yet commented on whether it sees “public benefit” in other human rights such as freedom of election or freedom of marriage, or whether anyone seriously believes that charging people a month’s salary to get a ballot paper or a marriage certificate would not restrict or impair those rights.
Practical effects
Because this fee hike apparently does not apply to relinquishments, ex-Americans who naturalise in most other countries will still be able to obtain a Certificate of Loss of Nationality from the U.S. government for no more than the cost of taking a day off work and driving or flying halfway across the country to the nearest consulate which isn’t backed up for months with renunciation appointments. (“Most other countries” means those which allow dual citizenship, like Canada and France, or those which forbid dual citizenship but allow new citizens to submit proof of loss of their former citizenship after the naturalisation ceremony, like Japan.)
However, Americans seeking to naturalise in countries which require new citizens to give up their former citizenship before the naturalisation ceremony, like Taiwan, or those who have been foreign citizens for decades or all their lives and never exercised any benefits of U.S. citizenship but now need to acquire a formal CLN (for example because their bank will discriminate against them if they don’t have one), will feel the full impact of the new fee hike, and also have to wait for months or even longer than a year for the State Department to give them a CLN before they can get on with their lives.
What changed?
The State Department has always claimed that processing renunciations has a high cost, but four years ago when they first introduced the renunciation fee, they at least pretended to take a very different attitude to the cost:
The CoSS demonstrated that documenting a U.S. citizen’s renunciation of citizenship is extremely costly, requiring American consular officers overseas to spend substantial amounts of time to accept, process, and adjudicate cases. A new fee of $450 will be established to help defray a portion of the total cost to the U.S. Government of documenting the renunciation of citizenship. While the Department decided to set the fee at $450, this fee represents less than 25 percent of the cost to the U.S. Government. The Department has determined that it must recoup at least a portion of its costs of providing this very costly service but set the fee lower than the cost of service in order to lessen the impact on those who need this service and not discourage the utilization of the service, a development the Department feels would be detrimental to national interests. See 31 U.S.C. 9701(b)(2).
They also note the per-hour cost they use to calculate the new fee:
The Department previously charged a consular time fee of $231 per hour, per employee. This fee is charged when indicated on the Schedule of Fees or when services are performed away from the office or outside regular business hours. The CoSM estimated that the hourly consular time charge is now lower. Accordingly, the Department is lowering this fee to $135 per hour.
This implies that they take about seventeen employee-hours to process each renunciation (assuming that none of the fee goes to other expenses such as travel or printing). Oddly enough, in their 2012 Paperwork Reduction Act filings on Form DS-4079 (which is filled out by both renunciants and relinquishers), the State Department indicated that the cost for processing the form was just $33 per hour. I don’t understand how these two estimates relate to each other.
To explain the new fee hike, the State Department point to procedures (such as the pointless and repetitive double in-person appointment system) which are required neither by the Immigration and Nationality Act nor the Foreign Affairs Manual, nor used by any other countries:
For example, consular officers must confirm that the potential renunciant fully understands the consequences of renunciation, including losing the right to reside in the United States without documentation as an alien. Other steps include verifying that the renunciant is a U.S. citizen, conducting a minimum of two intensive interviews with the potential renunciant, and reviewing at least three consular systems before administering the oath of renunciation. The final approval of the loss of nationality must be done by law within the Directorate of Overseas Citizens Services in Washington, D.C., after which the case is returned to the consular officer overseas for final delivery of the Certificate of Loss of Nationality to the renunciant. These steps further add to the time and labor that must be involved in the process.
As demonstrated by the experience of other countries, the State Department could greatly lower their costs by simplifying their procedures, but apparently such a common-sense step has not occurred to them.
But look on the bright side! 31 USC § 9701 says that “[e]ach charge shall be … based on … (A) the costs to the Government; (B) the value of the service or thing to the recipient; (C) public policy or interest served; and (D) other relevant facts.” Given how valuable a CLN has become these days, imagine how high a fee they could charge for it if they set the price based on its value.
Timeline for fee hike and comments period
The State Department ends with an excuse for why they can’t be bothered to tell us about the fee hike more than two weeks in advance, while keeping renunciants waiting for dozens of times that long to get the CLNs in the first place:
The Department intends to implement this interim final rule, and initiate collection of the fees set forth herein, effective 15 days after publication of this rule in the Federal Register …. The Department is publishing this rule as an interim final rule, with a 60-day provision for post promulgation comments and with an effective date less than 30 days from the date of publication, based on the “good cause” exceptions set forth at 5 U.S.C. 553(b)(3)(B) and 553(d)(3). Delaying implementation of this rule would be contrary to the public interest because the fees in this rule fund consular services that are critical to national security, including screening visa applicants.
You have until 4 October to submit a written comment on this rule. I will update this post with a link to the docket page on Regulations.gov once the fee hike is officially published.
Charl: A friend of mine has been a teacher in the BC school system since the early 80s. Three years ago she was told by a US government official that she could claim relinquishment on the basis of her employment by the BC government. She has elected not to take any action so far so I can’t tell you if it actually worked or not.
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@Neill, yes, my annual tax preparation fees would have run to at least $2500 anyway. As a one-off fee, it doesn’t seem that bad, but what concerns me is that I wouldn’t be surprised if they don’t eventually raise it to $10,000 or even $25,000.
When I renounced I was told to bring the 450$ in cash.
Are people now supposed to bring 2350$ along in small bills?
Patrick Cain, Global News, would like to speak with ANYONE WHO WILL BE AFFECTED by the increase in U.S. Consulate renunciation fees. Patrick.Cain@globalnews.ca
@Poll,
You can see the news in the future:
Long line of expats waiting to expatriate robbed at gunpoint.
What? I have to pay $2,350.00 to tell the government of the United States to stick it where the sun don’t shine? NOT! Anybody stupid enough to pay this fee deserves to be divested of that amount and more. My idea of renouncing my United States citizenship would consist of sending the State Department a certified letter stating my renunciation in no uncertain terms effective immediately, amen! Ask their permission to renounce them? I don’t think our colonial forefathers asked King George’s permission, did they? No, they just sent him a copy of the Declaration of Independence.
Polly,
…and not everyone will have credit card which is also accepted. Of course, MOST will have to save up or get a loan to make a U.S. citizenship renunciation happen now. It is one more shackle for *US Persons Abroad* locked in place — they key thrown away for many.
Patrick Cain is very quick to respond when you contact him with information. 😀
I may not have money, but I have brains.
Please, someone in Canada that hasn’t yet renounced, contact him. We need this out there in the news. I already have my CLN at $450.
Agree Brian. It just ain’t gonna happen in my case as long as Canada has any trace of sovereignty left. The US does have a nice little list of ways to get your citizenship removed for free.. I’ll have to take another look at it. Trick is to find one that won’t land you in jail. Would a youtube video of oneself pissing on the US flag warrant automatic removal of citizenship? Seems pretty harmless way to do it. Just remember everybody; that the IRS is severely understaffed at the moment. Their staffing numbers are much lower then they have been in the past.
TokyoRose,
My reading says 15 days after publication in the Federal Register, which is today. That would put the effective date Friday, September 12th.
@Tokyo Rose: “Effective date” mainly governs the comments period (this is an Administrative Procedure Act requirement). I don’t know why they’re not actually implementing the fee increase on the effective date; I suspect there is some other administrative law requirement I am not aware of which requires them to delay it for that amount of time.
The Four Exits
Treason conviction, anybody? How about documented enlistment in a hostile military force active against the U.S.? No?
That leaves (1) and (3). Taking bets that interpretation of policy-level in (3) just got way tighter.
Here’s the official declaration from 7 FAM 1222 ADMINISTRATIVE PRESUMPTION
http://www.state.gov/documents/organization/120546.pdf
c. The presumption stated in 7 FAM 1222, paragraph a, that a person intends to retain U.S. citizenship is not applicable when the individual:
(1) Formally renounces U.S. citizenship before a consular officer (INA 349(a)(5)) (7 FAM 1260);
(2) Serves in the armed forces of a foreign state engaged in hostilities against the United States or served as a commissioned or noncommissioned officer of a foreign state engaged in hostilities against the United States (INA 349(a)(3)) (7 FAM 1270); or
(3) Takes a policy-level position in a foreign state and is either a dual national of the state of employment or has taken an oath or affirmation in connection with the position (INA 349(a)(4) (7 FAM 1280);
(4) Is convicted of treason (INA 349(a)(7)).
That’s a very powerful observation of the respected person you talked with, Victoria!
Maybe we need to gather outside US consulates, media present, and do our own mass renunciations, fee-free. I think I got the oath back in the paperwork with my CLN.
@Brian in Chile: this is a very interesting point:
When the US was debating the Expatriation Act of 1868, Edwin Morgan of New York warned against implementing any system which would require immigrants to the US to provide documentation from their former countries that they had renounced their former allegiance. He said precisely what you did: that requiring such evidence would effectively mean making immigrants get permission from their former countries to renounce citizenship, which would go against the whole point of the Expatriation Act in the first place.
@Neill “If you can’t scrape together this amount of money (as a large number of people can’t) then the IRS isn’t going to do anything to you as you don’t have anything to take.” and “[T]he IRS isn’t going to do anything to you….”
These comments seem either insensitive or incomprehensible. The profound effect of this situation on people. regardless of their means, goes well beyond just the financial.
@Polly, my understanding is that you can bring the fee in Canadian dollars to pay there. If I end up paying $2,350, I’m thinking of doing it in loonies. Or maybe quarters.
I never thought about it that way, FromTheWilderness. I was happy to see my name on the Name and Shame List — and after your observation that that is verification that we have a non-counterfeit CLN, I am even happier. Thanks!
This is rapidly turning into a nightmare.
I would have been able to apply for Canadian citizenship next August. But Harper and Chris Alexander and crew decided to extend the waiting period and take away my pre-PR time, effectively making me wait three additional years. If it weren’t for my job, I would renounce now and live stateless for several years. But I have to maintain a valid passport for work.
I’m wondering if a country hostile to the USA would be willing to extend citizenship to those of us who are trapped? Say Venezuela, Russia or the other BRICS countries. Hmmm.
I’m a Canadian by birth and I feel threatened by a foreign government. I’m actually feeling more alien than Canadian these days, due to a certain clinging foreign “personhood” and the failure of my own government to recognize my Canadian citizenship above all else. Is it possible for me to seek refugee status here in my own country? Or will I someday have to seek sanctuary in a church basement to escape the foreign threat AND the failure of my own government to protect me from it?
Beam me up Scotty, this planet is insane!
Oops, forgot my main point:
What’s to say that by the time people like me are eligible for Canadian citizenship that the US hasn’t raised the price to ten or twenty thousand dollars? Or have put caps on the amount they will process each year, thereby putting us on a ten year waiting list?
At that point non-compliance and never setting foot in the US again would be the only option for numerous people.
@Shovel,
The real facts are that if you can’t get together $2350 then the USG goes out of their way to make your life easy. You likely don’t have accounts whose value exceeds $10k. You almost certainly don’t have accounts that put you in need of filling 8938. Your forms are going to be easy since you likely don’t have dividends or interest. You can quit the US without paying the exit tax and filling 5 years worth of taxes is likely a breeze.
Nobody is your keeper despite what Obama says. If you can’t scape together a couple of thousands you need to ask yourself why you can’t and what happens when a bad thing happens in your life and you need money.
@OddlyNamed
They want USD’s.
@Shovel
It’s not all that incomprehensible – the US has made it pretty clear that they’re only interested in us for what we can pay, for example, by having minimum account balances for reporting.
@Victoria
It would be interesting to know who’s specifically in charge of making the distinctions between residents and non-residents under FATCA. There may be at least a few people left who understand our situation.
@Arjan, just what I also fear. I originally wanted to wait a few years to see if the US wouldn’t reform things in our favour but decided to go ahead and renounce last year when I saw a clear opportunity to ‘get out while the going was still semi-good’…